How do advertising expenditures influence hotels performance?

[[abstract]]Existing studies have shown a positive relationship between advertising and hotel room revenue. However, it is not clear through which channel advertising affects hotel revenue. We contribute to the literature by showing that advertising has a significant positive impact on hotel room price, but not on room occupancy. Thus, advertising affects room revenues through room price, not quantity demanded. (C) 2012 Elsevier Ltd. All rights reserved.[[note]]SSC